July 01, 2024 Today at 9:07 PM
Updated July 02, 2024 11:03
Carrefour announced that it has completed the acquisition of the Cora and Match brands in France, as well as their purchasing center Provera. Louis Delhaize’s Belgian activities are not affected.
Its acquisition of Cora France and Match France does not concern the activities of the Louis Delhaize group in Belgiumthe Carrefour group said on Tuesday.
The group said in a statement that it had “finalized today the acquisition of the Cora and Match brands in France“, as well as their purchasing center Provera.
The transaction is carried out on the basis of an enterprise value of 1.05 billion euros.
Louis Delhaize owned 60 Cora hypermarkets and 115 Match supermarkets, often located in the north-eastern quarter of France. They represent, according to Carrefour, around 2.4% of the highly competitive food distribution market, and employ 22,000 people.
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“From October, each Cora store that changes its brand” will lower prices “by at least 10% on nearly 3,000 products” sold.
Alexandre Bompard
CEO of Carrefour
Second in distribution in France
This acquisition, “the most important for Carrefour since the acquisition of Promodès” in 1999, according to CEO Alexandre Bompard, allows Carrefour to consolidate its second place behind E.Leclercwhich holds almost a quarter of the market, and ahead of Les Mousquetaires/Intermarché which bought many stores from the struggling Casino group.
Carrefour announced in mid-June that it had obtained a waiver from the Competition Authority to complete this acquisition without waiting for its decision on the transaction, expected “by the end of the first quarter of 2025”, according to Carrefour.
The distributor considers “the competition issues to be limited” due to “the strong geographical complementarity of the two groups” and the “benefit of the operation” for “the consumer”.
During a telephone press briefing on Monday, Alexandre Bompard specified that “from October, each Cora store that changes its brand” will lower prices “by at least 10% on nearly 3,000 products” sold. A figure to be compared with the number of references sold in hypermarkets, between 20 and 35,000.
250
millions of euros
The associated integration costs, mainly spread between 2024 and 2025, are estimated at 250 million euros, compared to 200 previously.
The Match brand retained
Cora hypermarkets to switch to Carrefour by the end of the year, while the Match brand will be retained.
In a letter to new employees consulted by AFP on Monday, Alexandre Bompard explains that Cora must “benefit from a new lease of life” while Match “will retain its uniqueness”. The project will be presented to the social partners “in the coming days”, he added.
Asked by the press regarding the possibility of the acquired stores being switched to franchises or lease-management, store operating methods favoured by the distributor but criticised by its unions, Alexandre Bompard replied that The acquired stores “will be developed in an integrated manner at this stage”.
Carrefour said it was revising upwards the “synergy potential” of the operation, now considering an “additional contribution to EBITDA (gross operating surplus) of 130 million euros” per year “by 2027”compared to 110 million previously.
“These synergies will be generated half by an acceleration of the commercial performance of the stores”, the other half coming from “cost optimization.” “The associated integration costs, mainly spread between 2024 and 2025”, are estimated at 250 million euros, once morest 200 previously.
